Friday, May 22, 2015

Farmers’ Distress – Few Solutions

Farmers’ Distress – Few Solutions
R.C. Srivastava
Farmers’ distress has been a talking point this year. The unseasonal rains have done one good thing to Indian farmers. They have brought agrarian crisis in public discussion; else the rural areas have lost focus.  Although farming was never a very paying proposition, (in a lighter vain, a Sikh colleague used to say if farming would have been so paying it would have been dominated by Baniyas not Jats), but in recent years it has deteriorated sharply leading to a sense of deprivation in country side. Let us examine what is happening to a farmer. Land and water are two major natural resources on which our agriculture as well as rural economy is based. Although few people raises reduction in total cultivated area due to change in land use, there has not been any significant reduction in overall net cultivated area, although there is a sharp decline in the average size of operational land holdings in India. This is reflective of the immense population pressure on the limited land resource available for cultivation. The average size of operational land holdings has reduced by half from 2.28 ha in 1970-71 to 1.16 ha in 2010-11. Consequently, the number of land holdings in the marginal and small categories have swelled by 56 million and 11 million respectively, during the same period. The size of the land holdings has implications for investments in agriculture, its productivity, farm mechanization and sustaining farm incomes itself. Land holdings in the marginal category (less than1 ha) constitute 67 per cent of the operational holdings in the country (2010-11). In terms of area operated, the share of marginal holdings has doubled to 22 per cent (2010-11) from a mere 9 per cent (1970-71). Similarly, the share of (operated area under) small farm holdings (1 to 2 ha) increased from 12 per cent to 22 per cent during the same period . Small and marginal holdings together, constitute 85 per cent in terms of number of operational holdings and 44 per cent of the operated area in the country. Thus, over the period, the marginal category has emerged as a distinct and dominant class by itself with its average size dwindling to a mere 0.38 ha.
How much this marginal farmer will earn from traditional agriculture even if his full holding is irrigated which is case only with 40% farmers? Let us estimate his earning for this best scenario if he goes for rice-wheat crop rotation in his 1 ha land. With rice and wheat  productivity of 4 t/ha, his gross income will be around Rs.  1,16,000/- p.a. if he is able to sell it at MSP to procurement agencies. The net income will be around Rs 50000/- , which makes it just approx 4000/- p.m. less than Rs 150/- per day which is lower than minimum wages in most part of country. If we assume that he is contributing about 75% of his family labor in cultivation, the income will be approximately 6000/- p.m. which will still keep him below poverty line for all years to come. In this situation we have to innovate ways to keep this segment of farmers afloat. There are two ways to increase profitability of any enterprise. Increase the output/selling price of output material/ quality of output fetching higher prices OR reducing cost of input material. Let us examine different options:
Increasing price of output/ quantity of output/ quality and type of output fetching higher prices
(i) There is a clamor of increasing MSP.  Even if we increase the MSP by another 50%, which will have cascading effect on overall inflation, there will not be any significant change in his net earning as the additional income will evaporate by increase in his other expenses due to higher inflation. So a drastic increase is not in interest of either farmers especially marginal & small farmers nor overall economy of country.
(ii) There is need to improve the yields. Reliable irrigation facilities, supply of quality seeds and proper training of farmers can increase the yields which will enhance the yields. Successive state governments have left extension system to input suppliers by withdrawing the manpower and this has a disastrous effect.
(iii) A marginal farmer has to diversify his enterprise by adopting integrated farming system which will enable him to hedge against the risks of failure of one component. Besides increasing overall income, it will provide him self-employment for a significant part of  the year. Results have shown that income per ha can rise upto 3 lac per ha. However this require significant investment which is mostly beyond the reach of farmer. Even liberal bank loans have a risk of making farmer indebted and any natural calamity will make his life miserable. It will be worthwhile to examine whether the funds under MANREGA can be used for creating such infrastructure on the field of marginal farmers. This may be a small cost compared to cost of rural distress causes to social and economic infrastructure of country.
Reducing Cost of Input Mmaterial
The two major component of input cost are cost of irrigation and fertilizer, in addition to cost of animal feed for farmers who supplement their income through animal husbandary. Let us examine how we can reduce the cost of these input items.
a. Irrigation
(i) Presently about 65% of our irrigated area is irrigated by ground water and rest by surface water. Given the erratic supply of electricity in most of states, farmers use diesel pumps to extract ground water. Studies at Indian Institute of Water Management Bhubaneswar by author and his colleagues has shown that he cost of water is at least Rs 1/- more for each cubic meter of water pumped which is equal to almost Rs 750/- per irrigation i.e. approximately Rs 8000 – 10000 per annum per ha. If we energize all our functional pumping systems, the input cost will decrease by this amount in turn increasing income of farmer.
(ii) Most of our irrigation pumps function at less than 40% efficiency. If we enhance efficiency of pumps, another 10% saving in energy cost i.e. increase in income of farmers can be achieved.
(iii) The cost of pumping is also increasing with time as ground water level are decreasing. A study at Muzaffarnagar (U.P.) by this author and his team has shown that the type and size of pump has undergone sea change in last 15-20 years. 15 years back every farmer had centrifugal pumps which was firstly replaced by submersible pumps of 5 -7.5 hp when water levels went down. Later the pump capacity has enhanced to another stage and then to another. Today very few pumps are of 7.5 hp capacity(hardly 10%), most (approx 60%) are of 10 hp, about 25% of 12.5 hp and rest of even 15 hp. Thus there is need of large scale ground water recharge on a systematic basis. In hard rock reason, most of the losses leading to suicides can be attributed to higher cost of irrigation because of failure of tubewells due to falling water table.
b. Fertilizer
A village can be self sufficient in manure if they grow Gliricidia or that type of vegetation on their field bunds and use it for vermicomposting in combination with dung generated by their animals. A study by author has found that about 4000 t/year vermi-compost equivalent to 60 t of N, 32 t of P and 48 t of K can be produced in a village having 500 ha cultivated crop rotation of rice-wheat rotation if rice straw and vegetation on bunds are used. These shrubs of Gliricidia will also act as wind break to reduce damages due to high wind as happened this year. Although the studies on wind break is available only for trees acting as wind break to control wind erosion, but my gut feeling is that this will reduce losses significantly.
The nutrients demand of the village @ 90 :40 :40 NPK/ha for rice and 100 :50 :50 NPK/ha for wheat will be 190 :90 :90 kg/ha per year. However the requirement will be at least 25% less if nutrient are applied through organic means as the N losses are less and P gets mobilized. Thus for whole village, the NPK requirement will be 71, 33.5, and 45 tonnes. Thus, there will be just 15% shortfall in N, 4% excess for P and about 1.5% excess for K. Thus more or less the nutrient requirement of the crops can be met from local resources. The additional N can be obtained either from poultry manure or producing some green biomass from wastelands or mixing with inorganic fertilizer.
This system will also be energy efficient. The equivalent energy value for 1 Kg N, P and K obtained from inorganic sources is 60.6 MJ, 11.1 MJ, and 6.7 MJ respectively, while for 1 kg of vermicompost  it is 0.45 MJ (0.2 MJ for dung and 0.25 MJ for labour ). In organic system, 1 kg of N will be supplied from 66.67 kg of VC  whose energy equivalent will be  30 MJ. This quantity of VC will also supply 0.53 kg of P and 0.80 kg of K. The equivalent of these nutrient obtained from inorganic sources will be 71.84 MJ (60.6 for N, 5.88 for P and 5.36 for K). Thus there will be a saving of 41.84 MJ for each kg N supplied making organic system 139.5% more efficient.  Thus a small village will save an energy equivalent of 2526 GJ. Thus shifting to recycling of agricultural waste in a scientific manner will help in energy savings at national level as well as  will reduce the green house gas emission from the industrial activities.  This will also have additional benefits viz., reduction in soil acidity; more water holding capacity; recycling of micronutrient; improvement in soil health; and employment generation at rural areas.  Analysis has shown that it will provide about 62154 mandays employment. The availability of nutrients at village level will reduce cost of farmer in obtaining the fertilizer from urban centre as well as his tension of not getting it in time. Further if it is dovetailed with MANREGA for taking care of labour expenditure and other subsidies, the actual cost borne by farmer will be reduced significantly
Thus it is evident from above that if these steps are taken, the  input cost will be reduced and output prices will be more  making some positive change in balance sheet of farm enterprises.

Author is an Agricultural Scientist with ICAR. The views are totally personal and not reflect organization’s view

1 comment:

  1. Dear Sir,

    It is very informative and written with lot of in-depth analysis and quite useful for policy makers. regards, anand